1. Forms
2. CA
3. CA-21-09

What the form is

The CA 21 09 endorsement, titled "Texas Uninsured/Underinsured Motorists Coverage", is specifically designed for commercial auto policies in Texas. Its primary purpose is to add or modify Uninsured Motorists (UM) and Underinsured Motorists (UIM) coverage to the policy, ensuring compliance with Texas state laws. This endorsement details who qualifies as an "insured" under this specific coverage, the limits of liability the insurer will pay for damages caused by an uninsured or underinsured motorist, and outlines the conditions and exclusions applicable to UM/UIM claims in Texas. It essentially customizes the broader commercial auto policy to meet the specific requirements and options for UM/UIM coverage as mandated or permitted in Texas.

Classes of business it applies to

This endorsement applies to any business that owns, leases, or operates vehicles in Texas and has a commercial auto policy. Examples of such businesses include:

• Local delivery services operating within Texas cities.
• Construction companies with a fleet of trucks and vans used at Texas job sites.
• Sales organizations whose employees use company cars to visit clients in Texas.
• Transportation companies, such as trucking operations based in or frequently operating within Texas.
• Any commercial enterprise requiring vehicles for their operations within the state of Texas.

Special considerations

• Mandatory Offering: In Texas, insurers are required to offer UM/UIM coverage. Policyholders have the right to reject this coverage in writing. If not rejected, this endorsement would typically be attached to provide the coverage.
• Limits of Liability: The insured selects the limits for UM/UIM coverage, which will be specified in the declarations or the endorsement schedule. These limits cannot typically exceed the policy's bodily injury liability limits.
• Rejection of Coverage: If an insured decides to reject UM/UIM coverage, a separate rejection form is usually required by Texas law. The CA 21 09 would not be used in such a scenario, or a modified version might be used to reflect a rejection or selection of lower limits if permitted.
• Stacking Provisions: Texas law has specific rules regarding the ability to "stack" UM/UIM coverage limits from multiple vehicles or policies. This endorsement will reflect how these rules apply based on the policy terms and the specific edition date of the form.
• Hit-and-Run Accidents: The endorsement will typically outline the conditions under which accidents involving unidentified (hit-and-run) vehicles are covered under UM coverage, often requiring physical contact and prompt reporting to the police.

Key information for agents and underwriters

For Agents:

• It is crucial to explain the importance of UM/UIM coverage to clients in Texas and to clearly document their decision to accept or reject the coverage, as well as the limits selected.
• Ensure clients understand that this coverage protects them and their employees who are occupants of covered autos, or other insureds as defined, from bodily injury (and sometimes property damage, depending on the specific coverage purchased and Texas law) caused by at-fault drivers who have no insurance or insufficient insurance.
• Always use the most current, state-approved version of the endorsement.

For Underwriters:

• Verify that the UM/UIM limits requested are consistent with the underlying liability limits and comply with the company's underwriting guidelines for Texas.
• Ensure that the proper procedures for offering and rejecting UM/UIM coverage have been followed as per Texas regulations.
• The pricing of this endorsement will depend on the limits selected, the number and types of vehicles, the territory of operation within Texas, and other risk factors.
• Be aware of any specific Texas legislative changes that might affect UM/UIM coverage and ensure policy forms are updated accordingly.